John B. Taylor
Candlefocus EditorJohn B. Taylor is an influential figure in the world of economics. He is the Mary and Robert Raymond Professor of Economics at Stanford University’s Hoover Institution and a professor at the Stanford Graduate School of Business. He was named one of the most influential economists in the world by Bloomberg in 2018.
He earned a bachelor's degree in economics from Princeton University and then his Ph.D. from the Massachusetts Institute of Technology. Taylor is best known for his pioneering work on rational expectations, an economic theory suggesting that individuals have access to all available information when making decisions, making them inherently rational.
Rational expectations revolutionized economic theory and changed the way economists approach economic policy. In particular, Taylor is associated with the development of the Taylor rule, a monetary policy model which recommends the level of interest rates the central bank should set in order to achieve the optimal level of economic growth while keeping inflation in check.
Taylor’s research has contributed to the development of macroeconomics and has earned him multiple awards and distinctions. He was awarded the Karl Brunner Prize for his work on macroeconomics in 2004, and was honored with the John D. and Catherine T. MacArthur Fellowship in 1991. He was also chosen by President Bush to become Chairman of the Council of Economic Advisers in both 2001 and 2005.
Taylor has also been a vocal critic of some of the more activist monetary policies of the United States. He favors a more market-driven approach, arguing that it has been successful in stabilizing economies around the world. In addition, he has warned against the risks associated with extending the Federal Reserve’s balance sheet, which includes intervening in the economy to help stabilize it.
John B. Taylor’s contributions to the world of economic theory have been invaluable and his influence is likely to continue to be felt in the years to come. His commitment to rational expectations and his dedication to market-driven policies have been tremendously influential and have shaped the way economists around the world approach macroeconomic policies.